"Yuan" on track to become Asia 'anchor' currency: ADB

[Joseph20102011]

---

Whether we like it or not because of Chinese economic rise that competes the US economic interests and to have an cheaper transaction cost for China's side, the convertibility of the Chinese yuan will be inevitable and we Filipinos cannot prevent that and for practical purposes of not having economically isolated in the future, we have to accept the inflows of Chinese yuan competing the US dollar in our country. Regardless on what happened right now with our dispute with China regarding on Spratlys, China will be our number one buyer of our products soon.

Therefore, it's inevitable to have Chinese yuan as a reserve currency in 20 years time.

[FAQ]

They have to let central banks get hold of their currency , allow foreigners acquire Chinese bonds , stocks , and etc inorder their dirty toilet paper be a reserve currency .

[MetalManiac]

yuan to be the asian currency? in their dreams..

[M.A.D.]

The currency wars just got more interesting.

[monroy]

They have to let central banks get hold of their currency , allow foreigners acquire Chinese bonds , stocks , and etc inorder their dirty toilet paper be a reserve currency .

All paper money is worth less than toilet paper, that's the nature of fiat currencies. They only have value because people attach value to them through faith.

@joseph: Most people would prefer an ASEAN currency if that becomes a reality down the road as Asia's reserve currency but the reality on the ground points to the eventual dominance of Yuan in this region. ASEAN's combined GDP is only $1.8 Trillion USD whereas China's current GDP is $7 Trillion USD, an almost 3 fold difference. For reference other reserve currencies US GDP is around $14 trillion USD and the EU $15 trillion USD.

But there are no guarantees that China's growth will continue at historical rates, already their economy is headed for a hard landing. There's also a possibility for sudden growth in lagging ASEAN countries like Vietnam, Philippines and Burma which could see large jumps in our combined GDP.

I personally believe our country has a chance at growth in the 10-15% region within the decade.

[Vino Kid]

fake fake fake fake

[Joseph20102011]

All paper money is worth less than toilet paper, that's the nature of fiat currencies. They only have value because people attach value to them through faith.

Well said.

@joseph: Most people would prefer an ASEAN currency if that becomes a reality down the road as Asia's reserve currency but the reality on the ground points to the eventual dominance of Yuan in this region. ASEAN's combined GDP is only $1.8 Trillion USD whereas China's current GDP is $7 Trillion USD, an almost 3 fold difference. For reference other reserve currencies US GDP is around $14 trillion USD and the EU $15 trillion USD.

A possibility of a single ASEAN currency is low in the near future unless the respective ASEAN countries would give up their political and economic sovereignty for an ASEAN federalization. Once the Chinese yuan become a convertible and free float currency in few years time, the exchange rate of Chinese yuan in relation to US dollar would appreciate from 6.3 yuan today to 3.0 yuan by 2030 on which by then, China would be the largest economy in the world in terms of exchange rate.

But there are no guarantees that China's growth will continue at historical rates, already their economy is headed for a hard landing. There's also a possibility for sudden growth in lagging ASEAN countries like Vietnam, Philippines and Burma which could see large jumps in our combined GDP.

Actually, China's economic growth would stabilize to 7% for the next 20 years which is a gradual slowdown not a hard landing as China restructures their economic structure from investment-based to consumption-based and China's gradual slowdown is necessary to balance their economic structure for future growth aspects and social stability and also to give other regions in the world like Southeast Asia to converge economically in relative with North America, Europe, Japan, and China through massive FDI inflows.

I personally believe our country has a chance at growth in the 10-15% region within the decade.

Our country would grow with that such rate of 10-15% if we liberalize our restrictive and protectionist economic provisions of our constitution like scrapping the 60/40 equity restrictions against foreign investors and allow 100% FDI participation at all economic sectors in our country. Reforming our labor, immigration, educational, health care, social security, environmental, and defense systems are necessary too. Maintaining the restrictive economic provisions would trap us economically forever.

[mr_kyme]

A big no to me. Specially how they handle neighboring countries in Asia.